LEMOYNE,
Pa., July 10, 2024 /PRNewswire/ -- The
Pennsylvania Association of Realtors® applauds the
Pennsylvania General Assembly and Gov. Josh
Shapiro for passing a new law aimed at protecting home
sellers and buyers in residential wholesaling transactions.
Senate Bill 1173 (Stefano, R-Fayette; Rothman, R-Cumberland) amends the Real Estate Licensing
and Registration Act to define a residential wholesale transaction,
requires anyone who conducts residential wholesaling to have a real
estate license and ensures consumers are made aware that they are
engaging in a wholesale transaction. Shapiro signed the bill into
law on July 8, making it Act 52 of
2024.
"This legislation brings much needed uniformity to residential
wholesaling, which occurs throughout Pennsylvania," said PAR Incoming President
Bill Lublin. "It will provide
protection for consumers by requiring they receive proper
disclosures, ensuring transparency throughout the transaction and
giving them recourse if they encounter a problem."
Residential wholesaling involves the practice of transferring
property between buyer and seller through a third party, equitable
interest. Typically, a wholesaler approaches a homeowner and signs
a contract for sale. The wholesaler then goes out and markets their
equitable interest in the purchase contract to another buyer,
sometimes for a significantly larger profit than the original
purchase price with the property owner.
Act 52 will ensure that all parties involved in wholesale
transactions have a knowledge and understanding of the transaction
they are party to.
"The swift action on this legislation will now give homebuyers
and sellers critical information about what is often one of the
biggest purchases of their lives. Greater transparency will offer
safeguards for all parties – something we can all support," said
Sen. Pat Stefano.
Wholesalers often maximize their profits by targeting seniors
and people who are unaware of their home's true value. A wholesaler
enters into the purchase of a property, never intending to own or
take title of the property. The new law will provide recourse for
consumers who believe they may have been harmed to address the
wrongdoing that occurred.
"Residential wholesaling of real estate has become prevalent in
recent years, often at the expense of the most vulnerable," Sen.
Greg Rothman said. "Senate Bill 1173
would ensure that both homeowners and homebuyers are fully informed
of their rights and are equipped to make well-educated
decisions."
Act 52 will take effect in 180 days.
The Pennsylvania Association of
Realtors® is a trade/professional association
that serves more than 39,000 members in the commonwealth of
Pennsylvania.
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SOURCE Pennsylvania Association of Realtors